How to trick yourself into saving money

Many of us are terrible savers — and we know it. A recent poll discovered that 85 per cent of Canadians admitted that they need to save more money, yet 65 per cent said they have no savings plan. Another poll revealed that almost a third of us are approaching retirement with no savings at all. Luckily, there are smart ways to grow your savings.

When you’re already stressed out about paying the rent or mortgage, monthly expenses and reducing debt, saving money regularly can be left on the back burner for too long.

With this in mind, there are a few ways that you can ‘trick’ yourself into growing your savings without feeling the pinch.

Make your savings harder to access

Making it difficult to draw from your savings is a great way to resist the temptation of ‘stealing’ from them. By putting your money into guaranteed investment certificates (GICs), for example, you lock the money in for a set term. You can withdraw a redeemable GIC, but with a penalty — so there is a huge incentive to leave it there to grow.

Name your account

This trick is a great reminder of why you’re saving in the first place. Name your account based on that goal. For example, “My Own Place” for a down payment on a first home or “Financial Freedom” for retirement. It’s psychologically more difficult to take money out of an account that has emotional meaning.

Make your savings automatic

There are several advantages to setting up automatic savings deposits. By having the money leave your account on the day you get paid, you won’t even miss it and will quickly get used to managing without it.

Automatic savings also help us to act in our long-term interests, which goes against our instincts. When it comes to long-term investment goals, we typically prefer to do nothing. But once pre-authorized deposits are set up, your savings grow without you having to think about them.

Save your extra income

This trick takes a little more effort, but it grows your savings quickly. Make a promise to yourself that whenever you get extra money, you’ll put it immediately into your savings account, rather than the nearest steakhouse or day at the spa. For example, a work bonus, tax refund or pay raise would all be transferred into your savings account.

Save your savings

Likewise, when you make your final car or personal loan payment, continue to add that same amount to your automatic savings deposit. You were already accustomed to putting that money into debt, but now put it into something that will grow. And when you find an essential item on sale for significantly less than you budgeted for, deposit the amount you just saved.

Let technology do it for you

Some financial apps are designed not only to make budgeting a whole lot easier, but also to actively help you save. Apps like Mint and YNAB give you control of your finances, help you limit your spending and create budget plans for you, including automatic savings deposits. You can set them up so that every dollar you make has a specific “job” that can include going into savings. They make saving truly effortless.

The ACU Anytime mobile app also gives you control over your savings. You can set up automatic payments and transfer funds from your chequing account into your savings accounts at any time, in seconds. Whenever you have a little extra money that comes your way, you can transfer them into your savings quickly, before you get a chance to spend it.

Setting you up for successful saving

Our ACU advisors can help you set up the accounts that will help you get your savings growing.

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Call or email us today to set up an appointment with an ACU advisor and start tricking yourself into growing your savings fast.

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